Wednesday, February 06, 2008

Stock Market: A True Indicator of Economy’s Health?

Stock Exchange Drama: Can Government be responsible?

I have always believed that an investment in stock market is akin to gambling. Yes, there are some principles which govern the movement of a stock. PE, I am told, is the basis for an upward or downward movement of scrip.

In the last few days, there has been too much of hullabaloo over the crash of the stock market.

What flared me up was an interview of some association for retail investors or some such association’s spokesperson in one of the business channels. He cried foul over Government’s inaction in controlling the downward spiral. He added that many investors have come to the road and lost their investments.

I respect The Frontline but this article - - by Mr. CP Chandrasekar further incensed me. He blames PM and FM partially for the collapse.

At least, as for the current UPA government is concerned, I have observed that both PM and FM have regularly been non-committal to the blood-bath or extreme rise in adrenaline levels. Of course, I also do remember that BJP-led NDA Government would not loose any opportunity to stake claim for good performance. So much so, when the Congress-led UPA Government took over and the market collapsed, BJP made big hue and cry saying that Congress Government had lost confidence.

I am seriously wondering if stock market is really the true indicator of a country’s economic health. Please read, is it the TRUE indicator?

Shouldn’t an investor be held responsible for his investments?

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